New "Green" GM to Emerge From Bankruptcy Tomorrow

* Looks at watch *

Holy sh*t. I never would have bet that this would happen so quickly.

U.S. District Judge Lewis Kaplan rejected a request to delay the sale of General Motors Corp.'s good assets, clearing the way for GM to emerge from bankruptcy on Friday.

Kaplan denied a request to stay U.S. Bankruptcy Judge Robert Gerber's ruling allowing a Treasury Department-sponsored entity to purchase the bulk of GM's assets.

Fritz Henderson will hold a press conference tomorrow to detail "significant changes" - and unfortunately that means more layoffs. 4,000 white-collar jobs, including 450 executive level employees.

In the old GM, several committees often reviewed decisions, holding up new vehicles and making it slow to respond to market changes. Designs were often changed from bold to bland, with GM stamping out nondescript cars such as the old Chevrolet Malibu. With taxpayer dollars and its very existence on the line, GM can no longer afford to take too long.

So Henderson will thin executive ranks by 35 percent, from about 1,300 to 850 by the end of the year. Total U.S. salaried employment will drop by 6,150, or 21 percent, from 29,650 at the start of the year to 23,500 by the end.

Word is floating that they will change the GM logo from blue to green to symbolize better fuel efficiency and a more nimble company, which could work with the right advertising campaign, but in the end it still comes down to car design and quality. Despite the incredible pain caused by all these layoffs/plant closings, this will give GM a shot at getting it together and growing into a profitable company that may pay back those loans sooner than we think.

One disturbing aspect about both the GM and Chrysler arrangement - the companies will shed liability on old products. Speaking as the soon-to-be owner of a 2001 Saturn SC2 (black! stick! thanks Mom!), even a happy-go-lucky stupid consumer like me felt a bit of a pause at this purchase. Congress is considering a bill that will force GM and Chrysler to buy insurance to cover claims.

Consumer advocacy and safety organizations are lobbying to have consumers with existing product-defect claims against GM covered by the new GM. Safety Research and Strategies estimates that 35 percent of all death and injury claims reported to the National Highway Traffic Safety Administration involve GM cars and trucks.

Meanwhile, a bill, called the “Jeremy Warriner Consumer Protection Act of 2009,” has been introduced in the House of Representatives that would require GM and Chrysler to carry insurance that would cover accident victims who win judgments against the companies. Warriner is a paraplegic who lost his legs in a fire when he was pinned in his Jeep Wrangler after a side collision. If passed into law, this could help people with pending claims.

Congress is also considering forcing GM and Chrysler to keep all those dealerships open as well, and that is strongly opposed by both the auto companies and the White House, so it's unlikely that it will stick. Liability might be a different issue though. We will see.

Meanwhile, Long Live Saturn! If I can keep it nice until 2021 (ha ha - it's no creampuff now), it will be a classic, right? Here's to hoping they already found the major defects...